purchasing points P
Price Shopping of Cast Components Bob Mueller Jr., Joy Global Surface Mining, Milwaukee
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n the last issue of Metal Casting Design and Purchasing, I provided some details on why casting as a whole cannot be cat-
egorized on a “price per pound” basis. In this issue’s column, I’ll address a topic I feel causes more harm than good and gives the industry a poor reputation: price shopping. In the world of casting pur-
chasing, life would be much easier if all we were buying were sash weights. It would also be easier if there were a one stop shop where we could purchase all our cast needs regardless of mate- rial and complexity. However in the real world, we seek highly engineered cast components to meet the needs of our equipment and the end customers of these products. Today’s metal cast- ing industry con- sists of a wide array of suppliers with differing specialties and levels of abilities. Since my cross over from metal caster to purchaser I have seen this first hand. I have also seen associates and others outside my industry seek out the lowest possible source for their cast needs at the detriment of their product and ultimately the image of the metalcasting industry as a whole. Far too often, purchasing
to suffer through extensive quality problems and ultimately deliv- ery issues to your end customer. Cast components are individually unique and except for a few cases of limited commonality are not by any means commodities. Pricing of cast components takes a vast number of requirements into con- sideration and cannot be done per pound, like you might find with bar stock. Requirements such as material, quality specifications and post processing all factor in the cost of the end component.
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professionals seek out the lowest cost alternatives as a first prior- ity, foregoing quality and on-time delivery. This mistake will cost you in the end and cause your business
Far too often, purchasing professionals seek out the lowest cost alternatives as a first priority, foregoing quality and on-time delivery. This mistake will cost you in the end.”
In my first days as a purchasing
agent, I did business with a supply base chosen by a strategic sourc- ing group that classified some casting suppliers as “good at large round parts” and others as “good at long rangy parts.” These sup- pliers offered a generic price per pound that covered all the cast materials in the package. In some cases the price was good for the supplier, and in other cases, it was good for the OEM. The results of this sourcing effort were not pretty. On-time delivery averaged 38%, there was a 22% in-house
rejection rate, and lead times con- tinued to grow due to quality is- sues. When all was said and done, all the work was moved from these suppliers and placed with suppli- ers who were capable of producing the product and who had a niche for certain weight ranges and complexity, and a true understand- ing on the quality and delivery requirements each part had. The expense, delays and frustration caused by this “price shopping” not only caused problems for the OEM operation, but also with our customer base. It also gave cast components and the entire foundry industry a black eye I am still working to repair. The old saying “you get what you pay for” couldn’t have been truer. Pricing is
important, but it should NOT be the driving force behind your cast component
sourcing program. Those who do will only do it at the sacrifice of quality, delivery, your reputation as a sourcing agent and the reputa- tion of the industry in whole. Take pricing issues to the negotiation table with a reputable casting supplier who can first meet your quality needs and delivery require- ments. You can pay for it now, or pay for it in the end.
Bob Mueller Jr. is senior supplier quality engineer, cast product and casting supplier development, for Joy Global Surface Mining, Milwaukee. He has more than 30 years of casting experience.
Jul/Aug 2013 | METAL CASTING DESIGN & PURCHASING | 47
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